Blog series: Africa Telecommunications Market#2 Optical fiber access in Africa

If you are not already up to date with the future potential of Africa do not worry. The story for optical fiber in Africa from regulation and investment ecosystem aspects finds you today.

In the vast expanse of Africa, a digital revolution quietly unfolds, weaving a tapestry of connectivity that promises to redefine the continent's future. As of 2021, in Sub-Saharan Africa, 57% of the population was already captured by fiber cables [1]. Network expansion has been progressively developing in Africa, providing better access to the internet on the continent.

Figure 1: Existing fiber links in Africa

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The current state

Looking back at the last decade, Africa's digital environment has experienced tremendous revolutions. The entire continent of Africa in the year 2008 had access to only three fiber-optic submarine cables for internet connection, with the coverage being more of a centralized affair that was centered on North Africa [2]. A serious challenge the African continent suffers from is the absence of terrestrial fiber-optic networks which impedes the economic growth of the continent. The costs of laying the fiber optic cables are high, ranging from $15,000 to $30,000 per kilometer. Moreover, there are challenges in laying fiber cables in rugged terrains and remote areas that make this region complex to be connected and so most cell towers produce connectivity typically through satellites and microwaves because the network reach is limited [2].

Against the background of those challenges, the governments and stakeholders have come up with bold initiatives to broaden the fiber network all over the continent. For instance, South Africa has mapped out a plan to invest $10 billion over the next five years in a bid to enhance fiber optics technology, a move that would significantly improve internet connectivity for the better and create room for numerous new opportunities to open up. Ethiopia, Kenya, and Nigeria as well are allocating huge budgets toward their national fiber optic network projects [3].

The widening of the rural-urban divide in terms of fiber access is one of the most pressing concerns in Africa's fiber access agenda. Remote communities regularly face accessibility problems because of poor internet connection, and the opportunities that these services could provide such as education, healthcare, and economic services are limited.

Kenya plans to solve this problem through an initiative that connects rural areas with fiber optic cables that would link disadvantaged sectors with e-commerce and e-government services [3]. Lack of network expansion in the fiber networks in underdeveloped areas limits the possible economic growth and establishment of job opportunities. In 2019 the penetration rate of mobile internet in Sub-Saharan Africa was 24%. The World Bank estimates that at least 100 million Africans live in rural areas with no or limited cellular network connections [2]. Bridging such a gap by introducing campaigns and projects for the provision of necessary fiber access to isolated areas is crucial for the further development of the community that is being left out due to the digital divide.

Regulations around fiber

Policies and regulations have a crucial role in providing an investment environment that facilitates fiber infrastructure business in Africa. Regulations streamlining and simplification of the process of obtaining the right-of-way licensing are crucial for the fiber optic networks construction enabling process.

In the case of some African countries such as Nigeria, Egypt, Kenya, South Africa, and Rwanda, decentralization of processes like permit applications is still at the initial stage. The processing fees are usually controlled by the central authority in most cases. There are no adequate structures put into place to control and monitor the process of optical projects [4]. Governments are in a strong position to provide solutions regarding bureaucracy and ensure that the bottlenecks created by institutional and political affairs are stalled by all the stakeholders' interests [5].

Governments can conduct spectrum auctions as a way of giving frequencies for fiber optic transmission. In this case, the government awards frequency licenses to telecommunications service providers, which deliver fixed networks. The operators can use these licenses to obtain exclusive rights for specific frequency bands to deploy their own fiber networks. Alternatively, governments can decide to lease out spectrum to operators in return for licensing fees or royalties. In this scenario, the operators would pay the government an ongoing charge for the exclusive right to access an assigned spectrum band for their fiber networks [6]. Spectrum allocation is all the same and can help to meet the challenges of the restricted nature of infrastructures and the longer broadcast route distances as well [5].

Government entities function as facilitators in the mounting of rights of way infrastructure by establishing favorable permitting processes and by giving incentives to private sector investments. In some scenarios, this can be just the solution to the problem of the high price for laying fiber-optic cables and overcoming the problems of laying cables in rough terrain and far-away regions [3].

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Investment for fiber networks

Financing remains a major challenge in the expansion of fiber networks across Africa. As per World Bank statistics investing $100 billion in infrastructure that involves at least 250,000 kilometers of fiber is required to bring universal internet in Africa [7]. Private-public sector collaborations and government programs are now in the lead as far as infrastructure development in Africa is concerned.

Cooperation between the public and the private sectors is a widely used approach to satisfy Africa's demand for infrastructure. The government of Botswana is an example; they have commenced the construction of fiber optic networks all over the country with the participation of private companies that are working in collaboration with the government to ensure the networks are built and maintained [2].

Liquid Intelligent Technologies, a subsidiary of Cassava Technologies, plans to leverage Microsoft's technological resources to facilitate Internet connectivity for about 20 million people through the Internet in the African continent by 2025. Such partnership will combine important Microsoft capacities such as cloud services, software implementations as well as potential infrastructure assistance to facilitate the provision of wide-speed internet in areas where coverage is poor [8].

Innovation holds a vital role in Africa's fiber access journey which brings forth new opportunities for network development and improvement. From the deployment of cutting-edge Fiber-to-the-Home (FTTH) technologies to experimenting with alternative connectivity solutions, such as satellite broadband and fixed wireless access, Africa is at the center of digital innovation [9].

For instance, the United States Trade and Development Agency (USTDA) is working with partners like Dark Fibre Africa, a South African connectivity provider, to connect away areas beyond the major towns in the country and reach rural and peri-urban regions, therefore eventually improving the connectivity of the country. An innovative direction could search for places with the lowest population density and the greatest need for Internet services. Because of this, stakeholders will be able to identify the areas that have demand and can optimize the fiber infrastructure deployment and thus the cost reduction for the previously underserved communities in South Africa [10].

Fiber for mobile network operators

Fiber technology plays a major role in wired backhaul in the Mobile Network Operator (MNO) networks. The need for fiber backhaul, specifically for the Fiber to the Towering (FTTT) technology which uses the 4G networks, has been forced by the traffic increase in cities [11]. The incorporation of 5G networks in Africa encompasses aspects of optical fiber backhaul, extensive cell sites, and the addition of network virtualization and automation functionalities [12]. On the other hand, it is necessary to admit that some circumstances may stand as potential innovators' obstacles to the development of backhaul technology. Approximately 45% of all Africans reside more than 10 kilometers away from a fiber core network which largely undermines the backhaul capabilities of the whole network and the access network capacity. However, the limit poses a problem when it comes to technological scalability and growing operating expenses for an operator [11].

In the last five years, the capex of mobile phone operators in Africa neared $45 billion which is a significant amount that has been spent mostly on building and expanding 4G networks. Also, operators will in the future run 5G trials and take the necessary measures in keeping ready for 5G deployment. In particular, special attention will be paid to fiber backhaul investments and input of cell site densification, as well as the application of network virtualization and automation appliances. 5G sites will use both fiber and microwave backhaul technologies for such issues. Fiber is the better option for 5G, given that this technology has higher demands on capacity as compared to the typical microwave networks [12].

Wrap up

Fiber access in Africa's future is characterized by prominent trends and opportunities, which are illustrated through technology development, economic models' innovation, and the possibility of digital-driven innovation to facilitate socioeconomic advancement. Telecom companies are harnessing the newest fiber technology for network installations as many countries are building up their internet networks with fiber to the home and industries. This is expected to have a very profound effect on the capacity of the network and thus will be beneficial to every home country put in its scope. Fiber growth is going to take Africa to the edge of digital innovation and create more socioeconomic status. McKinsey forecasts that $300 billion of internet-enabled activities will be added to Africa's GDP by 2025 [13].

Bio

Samuel Ndegwa, an MSc. in Telecommunication Engineering, is a dynamic researcher who studies wireless communications. His passion for learning, combined with his history of adding value to the industry, he shares his ideas through various platforms. You can find Samuel on LinkedIn.

Edited by Murat Gürsu

References

[1] “Sub-Saharan Africa: fiber networks reach 2015-2021 | Statista,” Statista, Jan. 31, 2024. https://www.statista.com/statistics/1202917/fiber-networks-reach-in-sub-saharan-africa/#statisticContainer

[2] E. Rapaport, “Internet infrastructure in Africa,” Empower Africa, Apr. 04, 2021. https://empowerafrica.com/internet-infrastructure-in-africa/

[3] S. E. Technologies, “5 reasons why African governments are focusing on fiber optics,” Sep. 05, 2023. https://www.linkedin.com/pulse/5-reasons-why-african-governments-focusing/

[4] O. Nyarko‐Boateng, F. E. B. Xedagbui, A. F. Adekoya, and B. A. Weyori, “Fiber optic deployment challenges and their management in a developing country: A tutorial and case study in Ghana,” Engineering Reports, vol. 2, no. 2, Feb. 2020, doi: 10.1002/eng2.12121.

[5] E. C. Energy, “Fiber optic networks construction overcoming infrastructure limitations in developing countries,” Utilities One, Dec. 01, 2023. [Online]. Available: https://utilitiesone.com/fiber-optic-networks-construction-overcoming-infrastructure-limitations-in-developing-countries

[6] Simon, “Spectrum Auctions and how they work.,” RocketNet Fibre Internet, Sep. 13, 2022. https://www.rocketnet.co.za/spectrum-auction/

[7] “Modernizing infrastructure vital to fulfilling Africa’s promise,” Wilson Center. https://www.wilsoncenter.org/article/modernizing-infrastructure-vital-fulfilling-africas-promise

[8] G. Jack, “Liquid Intelligent Technologies, with Microsoft’s Airband Initiative, to bring connectivity to 20 million underserved people in Africa by 2025 - Cassava Tech,” Cassava Tech, Mar. 02, 2023. https://www.cassavatechnologies.com/liquid-intelligent-technologies-collaboration-with-microsoft-airband-initiative-to-bring-connectivity-to-20-million-africans/

[9] S. Roberts, “Opening up Africa with fiber,” Sep. 16, 2020. https://www.ppc-online.com/blog/opening-up-africa-with-fiber

[10] “Deploying American Innovation for Africa’s Digital Infrastructure – USTDA.” https://www.ustda.gov/blog_post/deploying-american-innovation-for-africas-digital-infrastructure/

[11] Maria Gabriela Macra, “Unlocking digital connectivity in Africa,” European Investment Bank. Accessed: Feb. 07, 2021. [Online]. Available: https://www.eib.org/attachments/publications/unlocking_digital_connectivity_in_africa_en.pdf

[12] K. Okeleke, J. Emanuel Kolta, and E. Kolta, “5G in Africa: Realising the potential,” GSMA. Accessed: Jan. 03, 2022. [Online]. Available: https://event-assets.gsma.com/pdf/5G-in-Africa.pdf

[13] J. Manyika et al., “Lions go digital: The Internet’s transformative potential in Africa,” Nov. 2013. [Online]. Available: https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/lions-go-digital-the-internets-transformative-potential-in-africa